Mr. John M. TaylorTo ask the Secretary of State for Social Security what estimate he has made of the average income of(a) people in work in the United Kingdom and (b) people who have retired. [102618]
§ Mr. RookerComparisons between the average incomes of households can be misleading if not fully explained. The most appropriate income measure when comparing different types of households is weekly net (disposable) equivalised household income (that is to say income that is adjusted to reflect the size and composition of the household). It is standard HBAI practice to give results for income both before and after housing costs, in334W order to allow for the effect of variations in housing costs between households. Using this definition the following information is available:
For families where someone is working the average net equivalised household income of individuals in benefit units with a working adult in 1997–98 (in April 1999 prices) was £367 per week Before Housing Costs (BHC), and £322 per week After Housing Costs (AHC).
For families with retired people the average net equivalised household income in 1997–98 (in April 1999 prices) was £242 per week BHC and £220 per week AHC.
Using an alternative definition, the average net unequivalised income of pensioner benefit units in 1996–97 was estimated at £175 per week BHC and £154 per week AHC (in July 1996 prices). These figures should not be directly compared to the equivalised income estimates given above.
335WNotes:
1. All equivalised figures are estimates and are taken from the Households Below Average Income (HBAI) data set which is based on the Family Resources Survey (FRS). The FRS does not include Northern Ireland. 1997–98 is the latest year for which information is available. All estimates are subject to sampling error.
2. The retired are defined as those in benefit units where the head or spouse is aged 60 or over and no adult is in work.
3. All unequivalised figures are taken from The Pensioners' Incomes Series 1996–97 publication (PI), based on the Family Expenditure Survey (FES). Pensioner benefit units are defined here as single people over state pension age (65 for men; 60 for women) and couples (married or cohabiting) where the man is over state pension age.
4. The PI figures for pensioners cannot be directly compared to other groups of the population since they are not equivalised (i.e. they do not take account of differences in size and composition of each household).
5. The PI figures for pensioners cannot be compared directly to HBAI figures for pensioners for several reasons. In addition to the fact that HBAI figures are equivalised, the PI figures relate to a different period (1996–97 compared with 1997–98) and a different geographical area (UK compared with GB). The PI figures are expressed in July 1996 prices and the HBAI figures in April 1999 prices. The PI figures relate to income at the benefit unit level, averaged over all benefit units, while HBAI figures relate to household income, averaged over all individuals.
6. The average net unequivalised income of single pensioners in 1996–97 was estimated at £129 per week BHC and £108 per week AHC (in July 1996 prices). The corresponding estimates for pensioner couples were £248 BHC and £229 AHC.